2023-05-04-莱坊-European_Office_Dashboard_-_Prague_Q1_2023_2页_517kb

Prague Office Market Summary Q1 2023

Occupier Market

Knight Frank's Q1 2023 update shows positive trends in the Prague office market. The vacancy rate decreased to 7.5%, down 22 basis points from the previous quarter, despite 37,981 sqm of new completions. Take-up reached 137,841 sqm, the highest in the last 10 years, with approximately 45% of transactions being renegotiations higher than average levels. Prime rent increased by 10.2% year-on-year to €324 psqm per annum, reflecting steady growth over the past two years.

Economic Context

Economic indicators for the Czech Republic reveal a strong market with one of the lowest unemployment rates in the Euro Area (3.7% as of March 2023). Job vacancy rates have been declining due to reduced hiring demand amid economic uncertainty. Service sector employment expectations and confidence indicators show slight declines, attributed to high inflation affecting consumer spending.

Outlook

The limited construction pipeline (90,000 sqm in 2023 and projected 50,000 sqm in 2024) and low new commencements suggest a shift toward second-hand office space, driving further rent increases and potentially favoring landlords in the coming years.

Contacts

• Ondřej Vlk: Head of Research & Consultancy; Email: ondrej.vlk@cz.knightfrank.com; Phone: +420 224 217 217
• Richard Curran: Managing Director; Email: richard.curran@cz.knightfrank.com; Phone: +420 224 217 2
• Colin Fitzgerald: Head of Occupier Strategy & Solutions EMEA; Email: colin.fitzgerald@knightfrank.com; Phone: +44 20 7861 1203